ReneSola announced its unaudited financial results for the third quarter ended September 30, 2018.
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Revenue was $18.8 million, compared to $27.8 million in Q2 2018 and $36.3 million in Q3 2017.
Revenue from the Project Development business was $5.5 million, due mainly to sales of 13.9 MW of community solar projects in Minnesota, United States and 6.7 MW of projects in France.
Revenue from the EPC business was $3.3 million due to EPC services for 3.7 MW of distributed generation projects in China.
Revenue from the sale of electricity was $10.0 million. The Company generated 66.1 Million Kwh of electricity from its operating DG projects in China.
Gross profit was $8.6 million, compared to a gross profit of $8.2 million in Q2 2018 and $6.4 million in Q3 2017. Gross margin was 46%, compared to 30% in Q2 2018, mainly due to the seasonality of solar irradiation and better margins in the project development business.
Operating expenses were $2.9 million, up from $2.3 million in Q2 2018 and $2.5 million in Q3 2017. Sales and marketing expenses were $0.1 million, slightly down from $0.2 million in Q2 2018. General and administrative expenses were $2.6 million, slightly down from $2.7 million in Q2 2018.
Operating income was $5.7 million, down from $5.9 million in Q2 2018 and up from $3.8 million in Q3 2017. Operating margin was 30.4%, compared to 21.2% in Q2 2018.
Total non-operating expenses of $2.1 million included interest expenses of $2.6 million, interest income of $0.1 million and foreign exchange gains of $0.4 million, mainly driven by the appreciation of the Polish zloty against the Euro.
Income before income tax and noncontrolling interests was $3.6 million, compared to $0.4 million in Q2 2018 and $4.0 million in Q3 2017.
Net income was $3.6 million, compared to $0.4 million in Q2 2018 and $4.0 million in Q3 2017.
The Company had cash and cash equivalents of $8.1 million as of September 30, 2018, compared to $24.8 million as of June 30, 2018.
The decline was mainly due to capital expenditures associated with construction activity for our projects in Poland and Hungary.
Long-term borrowings were $73.3 million as of September 30, 2018, compared to $72.7 million as of June 30, 2018.
The increase was mainly due to the project loan for Hungarian projects. Long-term failed sale-lease back and capital lease liabilities, associated with the financial leasing payables for rooftop projects in China, were $79.9 million as of September 30, 2018, compared to $85.0 million as of June 30, 2018. ■